Hungary’s Economy Minister Mihály Varga has held a presentation to an audience including former central bank governors, economy ministers and finance ministers at a forum organized by the German-Hungarian Chamber of Industry and Commerce (DUIHK). One of the government’s key objectives, he said, is to make the country one of those with small state centralization, low taxes and low budget shortfall. He has also addressed the introduction of online cash registers.
About the budget deficit:
the general government gap will not widen even in the election year (2014)
the budget deficit will remain under 3% of GDP even next year at 2.9%, after this year’s 2.7-2.8% shortfall (at this point we need to note that the official target is 2.7% )
About the general government debt:
Varga said the European Commission has also given recognition to Hungary’s achievements
including setting public debt on a descending path
Well, on that last point we only need to show you this chart.
About debt renewal:
Hungary repays some EUR 20 bn worth of debt annually
and the country has EUR 17 bn worth of debt that needs to be renewed,
with EUR 5-6 bn worth of FX debt needs clearing and forint debt maturing is around EUR 15 bn
Important goal:
Hungary’s financing need is high, being around 20% of GDP,
this puts Hungary in the same group with Cyprus, Portugal and Greece for instance
this exposure needs to be reduced in the future
Hungary needs to be among those countries that boast small state centralisation, low taxes and moderate budget deficit
The latter goal will be most difficult to reach in the current governing cycle.
About the black economy:
the ratio of the black and grey economies remains high
the Economy Ministry does not plan to amend the deadlines on the introduction of online cash registers (in direct connection with the tax authority).
the PC-based “large" cash registers still need to be replaced by 31 December
any shopping mall failing to make the switchover by this date, it will not open on 1 January or it may open but will not sell goods.
Hungary’s Economy Minister Mihály Varga speaks at a forum organised by the German-Hungarian Chamber of Industry and Commerce on 7 November 2013.
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